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Opinion
Narayana Kocherlakota

Biden’s Fed Appointments Should Send a Message

The central bank needs to be independent, effective and more diverse.

The best for the job.

The best for the job.

Photographer: David Paul Morris/Bloomberg

President Joe Biden faces a monumental decision: Whom to appoint to three top positions at the U.S. Federal Reserve, one of the world’s most powerful economic institutions. He should recognize it for the opportunity it is -- to reassert the Fed’s independence, to ensure the resilience of the financial system and to make the central bank’s leadership look more like the country it serves.

Two key openings will present themselves on Jan. 31, when two officials’ terms draw to an end: Jerome Powell’s as chair and Vice Chair Richard Clarida’s as a Fed governor. Also, the position of vice-chair in charge of bank supervision has been open since Randal Quarles completed his first term last month. So how should the Biden administration fill these vacancies?